The List of Credit Card Fees is Growing

Credit Card Fees Are Getting More Expensive

The recent surge in inflation and interest rate hikes has led to a significant strain on budgets. In addition to these economic pressures, Canadians are now grappling with an increase in credit card costs.

The Emergence of New Credit Card Fees

While credit cards offer convenience and reward points to their holders, merchants bear a different perspective. They are obliged to pay a certain percentage of their sales to credit card providers for every transaction, known as the interchange fee. This fee can vary, starting from a tiny fraction of a percent and going up to more than two percent for certain premium cards. Until recently, the agreement between merchants and card providers prohibited retailers from transferring this fee to customers. However, things have now taken a different turn.

In October 2022, a new law was enacted allowing retailers to impose an additional fee each time someone uses their credit card, to cover the interchange fee costs.

Underlying Reasons for the New Fee

The roots of this new fee can be traced back to a class-action lawsuit that Canadian businesses filed against Visa and MasterCard in 2011. The lawsuit was initiated because merchants were compelled to bear the burden of credit card interchange fees for an entire decade.

The lawsuit was resolved earlier this year, and as part of the settlement, businesses were reimbursed $188 million dollars for interchange fees. More importantly, the settlement gave businesses the permission to transfer these charges directly onto customers.

However, this new rule does not apply in Quebec due to its Consumer Protection Act, which explicitly forbids such fees.

Understanding the Application of the Surcharge

Retailers applying the surcharge must adhere to a strict protocol:


  • The surcharge should not exceed the interchange fee, which is usually around 2.4% in Canada.
  • Merchants must inform their credit card issuers and acquirer (the bank or financial institution processing credit card payments) at least 30 days in advance.
  • Surcharges cannot be levied on Visa Debit or Debit MasterCard cards.
  • Physical stores must display signs notifying customers of the surcharge at the entrance and the point of sale.
  • The surcharge amount must be listed on the transaction receipt.
  • Online merchants must also inform customers of this new transaction fee before they finalize payments and include the fee amount on receipts.
  • Merchants should add these credit card fees before taxes.
  • Cardholders must have the option to cancel the transaction without penalty.


Deciding When to Utilize Your Credit Card

With the introduction of these new surcharges, people might reconsider using their credit cards for regular purchases. While these charges might appear negligible initially, they can accumulate into significant amounts over time.

Understanding Your Credit Card Fees

To make an informed decision about when to use your credit card, you need to understand all the fees associated with your card. Annual fees, interest rates, and more are all factors that need to be considered. Once you have a comprehensive understanding of how much each transaction will cost, you can decide when to use your credit card.

Credit Card Rewards: Are They Still Worth It?

Many people use their credit cards to earn as many rewards as possible. However, with the new credit card fee, those rewards might not be as lucrative as before. Review the specifics of your rewards program to ensure that using your credit card still makes sense for you. You may even consider exploring other credit cards that offer better rewards and lower fees.

Managing Credit Card Costs

Managing these small fees effectively can prevent them from becoming unmanageable. The most effective way to control credit card costs is to pay your bill on time.

Dealing with Spiraling Credit Card Costs

If your credit card costs are already out of hand, Bankruptcy Canada can help. Our team of Credit Counsellors can answer any questions and help you devise a plan to regain financial stability.


In conclusion, the list of credit card fees is growing, and cardholders need to be vigilant and informed about the changes. By understanding the fees associated with your credit card, making informed decisions about when to use your card, and managing your costs effectively, you can still reap the benefits of credit cards without being burdened by excessive fees.

Find Your Personal Debt Relief Solution

Licensed Insolvency Trustees are here to help. Get a free assessment of your options.

Discuss options to get out of debt with a trained & licensed debt relief professional.